Indonesia energy regulator trims 2014 oil target -media

May 22, 2013|Reuters

JAKARTA, May 23 (Reuters) - Indonesia's energy regulatorsays the country's oil production target next year is toooptimistic, and wants it scaled back between roughly 4 percentand 8 percent, domestic media reported on Thursday.

The former OPEC member was once self-sufficient in oil andgas but has been struggling for years to attract investment tohalt declining oil output.

Southeast Asia's largest economy has often missed annual oilproduction targets, which have gradually fallen from a peak of1.6 million bpd in 1995.

The government set an oil production target of between900,000 and 930,000 barrels per day in its 2014 budget proposalannounced on Monday.

But Rudi Rubiandini, chairman of SKKMigas, said theregulator wanted to see a match between the target and planning,the Jakarta Globe newspaper said.

"We don't want any irrational budget assumptions," the paper quoted him as saying on Wednesday.

"Whether the lower end and the top end of the target will beachieved will depend entirely on when Exxon Mobil's Cepu blockin East Java starts production," Rubiandini added, referring toIndonesia's biggest oil find in the past decade.

If Cepu didn't come onstream until later in the year thenaverage output would only be 860,000 barrels per day, he added.

This figure compares to crude lifting of around 840,000 bpdin March, when the regulator said it hoped Indonesia couldexceed 1 million bpd in 2014.

Indonesia is banking on Cepu to prop up its dwindlingdomestic output of crude, with anticipated additional productionof 165,000 bpd when the block begins full operation next year.

The government has put pressure on Cepu block operator ExxonMobil to meet its target, through measures such as theeffective dismissal this year of its local chief executive.

Indonesia's natural gas output will be unchanged next year,at around 1.24 million barrels of oil equivalent, the regulatorsaid.

Natural gas output is expected to increase in 2016 whenlarge-scale gas projects commence, including the Masela blockoperated by Inpex and Indonesia Deep Water Developmentoperated by a wholly-owned Indonesian unit of Chevron Corp, he said.